welcome to "squawk box" here on cnbc. i'm becky quick with joe kernen and andrew ross sorkin who is happy to be back. >> i don't know if i'm happy to be back. lovely to see you. it was a nice week and a half. fun to be back. >> were you getting up at 4:00 a.m. every day? >> no. almost. 6:00 a.m. so the thing i miss this morning is the kids running into the bed. that is something we don't get to do enough. >> no. >> along with the family unit, you don't. >> and hang out at that -- >> they're in that wing of the upper west side, right? are they allowed in there? >> of course they're allowed. on the weekends they're allowed in there -- >> i thought the staff had explicit instructions not to let them into that part of the compound. >> yeah, yeah. >> upper west side compound. >> upper west side compound, we try to keep everything separate, but -- >> soundproof -- >> the vacation -- >> on vacation -- >> we break things down.

we break the rules. >> didn't make them stay in the guest house? >> well -- just joking. >> he really sounds rich, doesn't he? >> i don't know how you created this whole sort of -- >> you were born with a silver spoon, i'm sorry, in your mouth. >> so great to be back from vacation. >> it is past 6:01. >> you said that before 6:01. let's start with the markets on first trading day of august. july was the best month for stocks since january. the s&p has now turned in 8 positive months out of the last 9, going back to november. as for the fear level in the markets, volatility actually dropped more than 20% in july, so people got pretty complacent. you can see the vix at this hour trading just about 13.5. the best performing sectors last month were health care, industrials and materials and yesterday the markets barely budged. pretty active trading day. watching at one point, the dow was sitting at a new intraday high in the middle of the day.

traded all the way up to triple digits before closing down by less than a point. you can see those strong gains are back in the futures. futures up by triple digits, up 108 points. s&p up by just over 12.5 points. the nasdaq up by 22. we have a number of key tests for the markets today. on the economic front, weekly jobless claims coming in. manufacturing pmi, ism manufacturing, construction spending and monthly auto sales coming in throughout the day. overseas, the bank of england set to announce interest rate decisions. the boe is due at 7:00 eastern time and the ecb about 45 minutes later. as for earnings, dozens of companies are set to post quarterly results before the bell. we have big names out there including exxonmobil, procter & gamb gamble, conocophillips, kellogg and clorox and then aig, linkedin, kraft foods and others. andrew, this is -- you thought you may have been coming back at the end of the earnings season,

we have a lot of names to go. >> august 1st. >> you would think that earnings would be -- >> in july. it is the quarter ends in june, right? >> why does it take so long? >> they should be able to -- if they can't get it done -- i don't think we should did any of these. if they can't get it done in month after the quarter ends, what are they doing? are they doing something with the numbers they can't get it done in july? >> maybe you want to wait until after the big crush has come through so your earnings get a little more attention. >> comcast reported yesterday. they got right -- you can do it in july, you take your time, get it done, but get it done by the july 31st deadline. stock was up. >> other news out of china. economic data out of china overnight also getting attention this morning. china's factory activity was slightly stronger than expected. a private survey of smaller firms suggesting that manufacturing remains under

pressure. chinese economy has slowed in nine of the past ten quarters at major asian markets. all up. shanghai composite up almost 2%. >> someone sitting right here said that instead of measuring output in china, if you measure the consumption -- >> that's the better measure. >> came up with minus 4%. >> yes. >> and so any numbers coming out of china are just like fantasy. who knows. we report on this like it is news, and -- >> the chess master. >> it was the chess master. was it -- maybe it was the chess master, someone sitting with us, i don't know. >> anyone remember? >> bob bavera with the chess master. >> that's down 4%, forget about it. back here in the united states, a little more news on

speculating swirling about the new fed chair. a meeting with house democrats on capitol hill, get this, yesterday. president obama defended larry summers saying that critics aren't giving the former clinton era treasury secretary a fair shake. the white house says the defense wasn't an endorsement of the fed post and the president won't announce bernanke's replacement until the fall. summers and yellen the most talked about names. on the hill, obama also reportedly mentioned former fed vice chairman don kohn and taking shots at our good friend -- i don't know if he was taking shots at arianna huffington directly but the huffington post and really the push against larry summers is coming from what he thinks is sort of a really sort of progressive left leaning side that has come -- >> you think? >> telling you what the report says. >> yeah, it is obvious. i saw one this morning on the huffington post, i don't know who this guy is, it is great.

i thought, where do they find these people? and what he does for a living. let me just go down and see who this guy is. but the title of his piece today is -- so obnoxious. i don't know -- you have to know the -- i have to read this stuff. his name is robert shear. editor of truth dig.com. he's got the beard and the glasses. and he's author of the great american stickup. and they title this as gag me with larry summers. the idea that barack obama would still consider appointing lawrence summers mocks the president's claim that he's concerned about the disappearing middle class. it is just -- just about every single article here, that's all it is about, just blah, blah, blah, blah. and it is so annoying, but your paper the other day with an unequivocal janet yellen, anything you -- any idea that it would be larry summers. >> i read that.

>> the wrap on summers is he might know bankers. he's not totally opposed to the entire banking sector and doesn't vilify them to the extent he would like to put them all out of business or nationalize them. >> you don't start at the baseline of being elizabeth warren. >> you're right. you're right. right. and either you start with her, and then you get as close to the center as chuck schumer. you don't go any further past there. >> oh, no. i think you start at -- >> go left. >> who is left of her? >> i don't think -- you got to go off shore to -- >> when is funny is yellen isn't. yellen is probably much more centered. >> i want to know whether -- is the president just making it seem like he's considering all the -- and then he does yellen. he never says anything good

about her, he assumes it is going to be her, so he wants to show -- >> sticking up for the underdog. >> where did donald kohn come from? >> i read the administration may be a little frustrated with this push that if they don't name a woman, to introduce gender into the entire thing without considering yellen's consideration -- her own qualifications, i think they're really ticked off at the entire gender card has been dropped in. >> it is less. this is me coming back from vacation, it is less what is happ happening in washington and more about what the media speculation that is every day, somehow they're sitting around every single day. >> for markets, a little slow news. >> i've been interested. we're not waking it up. we know at first it was larry summers must be floating his own name. that's bs. coming straight from the white house and the president did bring it up and did defend him.

>> you saw who the bane backer is. gene sperling. >> geithner. we know who he hasn't gotten along with. that's what is a little bit surprising. i don't think he got along with valerie, but i don't know. we'll see. but obama rewards -- he's loyal. i think summers has been -- summers was in a much more centrist administration and, you know, clinton. clinton had a good record. >> i feel bad over the whole debate. i think it minimized and belittelled both yellen's and summers qualifications. >> and twisted them into almost clic cliches. >> ridiculous. >> caricatures of who they are. right. >> i think both of them are incredibly qualified. i think both of them would do a very good job. i think summers has gotten a bum rap. he has people attacking him from

all sides. ben white wrote the committee to save the world from larry summers, that cover story of the committee to save the world. >> and the people in the center and right are saying the idea that one is less keynesian than the other is not -- larry will be plenty accommodative. >> he's been much more publicly outspoken. >> about qe, not other ways to spend money. >> infrastructure, right. >> not going to sit there and say, wow, we need -- he's not an austerity guy. that's for sure. we'll see. he's just more fun to cover than, you know, i want to -- when he gets mad, you saw what he did to the wifnklevoss. >> we loved it too. >> that's why i want him to get it, just to follow that three or four years. i never heard yellen say anything other than -- as we mentioned earlier, the ecb

meeting today. i know. i know. relax. people are yelling. jeff joins us from the hideous sculpture with the latest. >> joe, it is more exciting than you're presenting it as. i have to tell you. mr. draghi here really threw a goblet to the market at the last meeting when he embraced this whole idea of forward guidance. and talking to the market like mr. bernanke does. unfortunately, he didn't tell us how long an extended period actually means as far as keeping rates low here at the ecb. we're hoping to get a bit more finessing on the message. is it 12 months, 18 months, 24 months, does it depend on unemployment rate, does it depend on cpi rate? that's what we're hoping for. little more guidance on the forward guidance. plus, they also have thrown in this idea, joe, that we're going to start seeing how individual

members voted. there are 17 members on this governing council. and at the moment, to spare their blasses, they're not going to release the results of the voting patents for 30 years. now they say maybe we need to be more transparent with the market and start showing them how individual members voted. that's what's been suggested. we'll come up with the meeting. we'll look out for that. as far as rates are concerned here, the key rate is, what, .5, no one is expecting there to be a change here. we had better manufacturing pmis out of the core european members, about an hour or so ago. that's possibly given mr. draghi a little bit of breathing room here. he is moving the market, though. you only have to look at what happened since the last meeting, the dax put on 5%. the german index. the euro is up 1.7 against the dollar. and then if you go back 12 months and you look at the last big splash that draghi made when he said we will do whatever it

ta takes, phenomenal, 35% up side on the ibex, the spanish index. 26% on the german dax. and the euro is up nearly 7.5% here, joe. so mr. draghi is able to move the markets as we run into this slower summer here in europe, just remains to be seen whether he feels the need to communicate any more deeply with the market today. >> all right, we'll listen. you got -- you piqued my interest. we'll see. we'll see if he says anything earth shattering. are all of the stars still on? look behind you. how does that -- yellow and blue. it is ugly. the symbol of the euro is pretty ugly. >> yeah, yeah. joe, let me show you something here. and my german cameraman, i'm not sure how good our communication skills will be at this point, but he can pan in a little bit to this big euro. i don't know if you'll notice,

but there are a number of holes in the few of the stars. if you can see here, it is a little bit tarnished and it is a little bit dented and it is a metaphor used on more than one occasion to show that the euros have quite a tough time over the last four or five years. >> how did that happen? >> do you see the holes? >> yeah, punched holes in it. damage and they haven't fixed it? >> yeah, well, you know, you have those protesters too, i think, who were hanging out in some of the parks in new york and other places. we have those protesters here. germany sees them quite often outside the european central bank. as they hang out here and they make their views known about how the crisis has gone, some of them just get a bit carried away put stones through the stars. it is a bit rough actually, personally, but -- >> even below the stars there. looks a little roughed up. >> yeah. >> free trade. >> which is remarkable. which is remarkable, joe.

>> what's that? >> most people think of germany as a clean, orderly country. society runs smoothly here. i hate to say it, but the trains run on time, all that kind of stuff. you come here and you actually see how beaten up the euro symbol is, it somewhat sits at odds with that idea that germany is smooth, efficient, and things get fixed quickly. >> yeah. i do have that opinion to some extent, but, you know, a lot of times if you construe it as being serious, the wild side is wilder. the demonstrations there and i hear berlin too, the night life and things that go on, those germans, that cool exterior, there is a furnace, you know. still european, right? >> well, let me let you into another secret here. i don't know if you spent any time here in frankfurt, joe, but just a block away from the ecb

headquarters is a very notorious red light district that sits -- >> i haven't been to germany. >> the huge banks, you know -- >> am i giving you a reason to come? >> no, as a tourist, i mean, i do, i'm interested in the seemier side. i'm not spitzer. i'm not going to hang out there, but i would like to maybe, you know, i wouldn't roll the windows down. i would keep my hands inside. like lion country safari, i don't want to get involved with any wildlife, but i might look. like you. like you. >> it is fascinating because frankfurt, i mean, germany is the way it is. frankfurt is the business headquarters, berlin is the political headquarters. you go around the country in different regions do different things. here in frankfurt, it is full of banks. and bankers and strangely, as i say, right next to all the banks and bankers, you've got this red

light district. >> yeah, yeah, yeah. you need -- yeah, let off some steam with all that money that they're -- i got it. we are planning a trip there, the family. i think actually that's my home land, i found out, late in life. anyway, jeff, thank you. we appreciate it. he was ready to talk, ready to give us a -- >> the lay of land so to speak. >> almost a tour. i learned a lot there. even berlin. you've been to frankfurt? >> i've been to frankfurt, yeah, years go. when vodafone was buying manis. >> that's why you were there? >> that's why i was there. reporting on that. >> you're kidding. >> yeah. >> i report from here. think you can do it from here? >> back then you go because you tried to stay at the hotels where the bankers would stay and try to figure out what was happening.

>> all right, guys. the futures again this morning are up triple digits. dow futures up by 100 points and the yield on the ten-year has come back down. yesterday, 2.7%. looks like it is around .6% now and that is bringing you a little bit of the green arrows back into the market. when we come back, mixed news on the chinese manufacturing sector overnight. we will ask if the country's economy is on the verge of a turn around. first, as we head to break, a look at the best and worst performing s&p stocks in the month of july.

welcome back. take a look. the dow futures up by 105 points. yesterday, the dow was sitting at a new intraday high, up by triple digits. then after the fed, things came back down particularly with the yield on the ten-year up around 2.7%. today, the ten-year yield around 2.6%. the dow futures back up by triple digits. ten-year note, 2.6%. other headlines, cigna earning $1.78 for the second quarter. 18 cents better than the street expected. also raised its outlook citing strong sales growth and favorable trends in medical

costs and operating expenses. there was economic data out of china overnight. better than expected. pretty much expectation was for it to go down. it went the opposite way. gordon chang, the author of "the coming collapse of china" and columnist at forbes. i'm expecting you to say the numbers are fake and we shouldn't believe them. >> the hsbc purchasing managers index was true. that fell from 48.2 to 47.7. >> but the pmi number -- the thing that people look at -- i don't know if they're supposed to look at it or not, but that went up and was supposed to go down. >> everyone expected it to fall from 50.1 down to 49 point something, going from expansion to contraction. instead it went up. it is not consistent with what we know about the chinese economy. so, yeah, i think it is fitting. as the economy deteriorates, the gap between what the government tells us and what is really

going on, i think is widening. >> i wasn't hear when this conversation apparently happened. joe was referring to the past 15 minutes, the idea of what you should be focusing on, what guest was it -- what we should be doing is looking at consumption as the statistic as opposed to output. >> imports are important because it shows domestic demand. it shows what manufacturers are really doing and shows what chinese consumers are doing. imports, of course, they fell in june. this is really important. i think that it presages a trend. we're starting to see a deterioration in trade numbers. that's going to show up in manufacturing. just a couple of days ago, you had the ministry of industry and information technology order the closure of, you know, 1400 companies, excess manufacturing production of 1400 enterprises

in 19 sectors. this is going to hit manufacturing towards the end of the year when it is supposed to take effect. >> you have a lot invested in the coming collapse of china as you have a book with that title. what would change things for you? >> i think what we're -- >> what would surprise things for you? >> i think the important thing, you see the politburo standing committee really have structural economic reform. do things that are really important that no one thinks that they would do. so, for instance, allow deposit rates to go up, allow manufacturers to do all sorts of things they haven't in the past. stop this campaign against foreign companies, allow workers to bargain collectively. all of these things would help consumption. they're not doing them. the fact that they're not doing them tells us that, yes, they will say they're trying to increase consumption, but really they're not doing that because they will not go to these reforms. >> and from a credibility standpoint what would have to happen for you to believe the

numbers. >> i think they would have to be in line with all of the numbers. essentially what we're seeing are data sets, there are some numbers going up, some numbers going down, the more reliable ones, the ones beyond the control of the chinese central government are the ones that are really the most worrying. we would like to see all of the numbers going in the same direction and be consistent. >> gordon chang, thank you for joining us. appreciate it. >> weighted toward smaller and -- >> negative. >> coming up, a new survey finds u.s. natural gas prices are expected to creep higher for the remainder of the year. and, again, in 2014, we'll talk to the ceo of america's natural gas alliance. and next, as we head to break, a look at july's best and worst-performing dow components. if you're serious about taking your trading to a higher level, tdd#: 1-800-345-2550

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♪ good morning. welcome back to "squawk box" on cnbc. it is almost 6:30 on the east coast. i'm joe kernen with becky quick and andrew ross sorkin. jury in the fabrice tourre will resume today.

yesterday we knew they were in deliberations because he didn't call any witnesses, right. the defense called no witnesses. macy's and jcpenney back in court today. a judge set to decide whether penney can sell certain martha stewart branded home goods despite macy's exclusive deal that they had with her. and closing arguments, the judge could render his verdict from the bench today or issue a decision in the next couple of days. both of these are old dragging on cases. >> five years ago. a survey is finding that u.s. natural gas prices are expected to creep higher for the remainder of the year. and again in 2014. the reuters poll of analysts says the demand will continue to improve after extremely low prices last year attracted more users. we'll be talking to the ceo of america's natural gas alliance in the next half hour. a different study out this week, we'll talk about this right now,

a different study suggests drillers in north dakota's shale are burning off over $100 million or a third of the gas they produce. joining us right now to talk more about it is marty durbin, the president and ceo of america's natural gas alliance. we talked about the report of the flare, a billion dollars in natural gas in 2012 and something like $3.5 million every day that gets burned off in the flare. we have a picture from space where you can see what is happening in north dakota, and i think we'll show that on the screen in a second. what happens? why does this happen? >> with an infrastructure issue, as the industry comes into an area especially an area like north dakota that hasn't seen this type of production, just five or six years ago, north dag 800,000 barrels of oil a day. the pipelines, the processing plants, that's all coming online. industry is investing $4 billion

in the state of north dakota alone to get the infrastructure in place. no question, it is a valuable commodity, want to capture it, and we have the infrastructure. >> listening to you, i mean, that's -- that means jobs, think of the jobs it created. >> how much did you say was spent and it was -- none of it was covered. >> it is really working well. >> prince ali made some statements this week talk about how he thinks the middle east needs to get worried about what it is seeing right now in terms of production and maybe diversify. you think you can continue to grow beyond 800,000 barrels a day? >> in projections in north dakota say production going a million barrels a day and more. that doesn't include southwest

texas, and the natural gas production continues to grow as well in the marcellus and you got lots of other opportunities, when demand comes on even further. >> and at this point it has been the railroads, burlington, how many train cars they have coming out of that area. how long does it take to build up the infrastructure? >> it is happening now. it is a matter of years to build the entire infrastructure, but depends where you are. in north dakota didn't have much of an infrastructure. texas, oklahoma, have more. in the mid-atlantic and marcellus, more natural gas rich, the infrastructure, there was some there, it is now coming online. a lot of companies in their building pipelines. >> how difficult is it to get the permits? >> that is an issue at the state level and federal level. we want to make sure we have a process in place that the permits can be provided in a speedy, you know, speedy

fashion. not an absolute barrier or obstacle, something we're working closely with the government to make sure the permits are available. >> yesterday, we talked about how ford is coming out with a new pickup truck, you'll be able to use the option of converting it to cng. we talk about the chicken and egg issue, what comes first, the infrastructure or the whole -- do you bull ild up the infrastructure first? >> this doesn't take away that issue. ford motor company, the most popular line of cars they have, you know, take an f-150 pickup and make that available to the consumer for using cng. the more we see the automakers do this, the more the infrastructure will be built out around that. so, again, we already are seeing a lot of pickup in fleets, and even in the high horsepower. the fact that ford is taking a step and saying we're going to provide this to the consumer is huge. >> there is a huge disconnect between the price of natural gas

and the price of oil and gasoline. the reason that it is so attractive now and the reason you see companies doing this is because natural gas prices have been so incredibly low. >> we continue to see production increase. right now we have seen the rig count for natural gas rates on their own. in the last two year goes from 900 to 400. yet the production keeps going up. it keep going up because not only are companies more efficient at producing wells, been more productive wells, but as they have been moving into producing more oil and natural gas liquids, you continue to get natural gas with that, associated gas. that keeps more product in -- keeps the production up. >> do you disagree with the poll we just said where most economists are looking for the price of natural gas to go up through the rest of the year. >> concerning how low the price has been, creeping up, you're in a very reasonable level and

every projection i've seen going up 5, ten years, we're in a very reasonable ban as far as price goes. certainly won't hurt our industry to have the price creep up a little bit. that will allow us to continue the products at the levels we're seeing and more and meeting that oncoming demand and power generation and industrial users and in the transportation, we get the jobs, the economic growth, reduced emissions, all because of the affordable clean and dmoeomestic resource. coming up, we'll welcome kenny dichter, we'll hear about his latest business venture. we'll ride in a car with a price tag of more than $2 million. check this out. we have it right outside of the cnbc headquarters now. robert frank will introduce us to the bugatti at 6:5 eastern time. [ male announcer ] come to the golden opportunity sales event to experience the precision handling of the lexus performance vehicles,

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welcome back to "squawk box." look at u.s. equity futures at this hour. see how things are setting up. we have green arrows. dow, 102 points higher. nasdaq, 20 points, the s&p 500 about 12 points. a statement just out from retailer jcpenney, it says cit group continues to factor and support deliveries from jcpenney suppliers in reports yesterday that they cut off credit due to penney's vendors. the retailer says all the key vendors have maintained their shipments and it has been told directly by ycit that yesterday's reports were not true. >> the stock sold off 10% on those reports. for them to say the reports were

uncr untrue, got to wonder if the stock will pick up from here. >> the market closed down yesterday. seemed like you got everything -- if the number tomorrow is good, what you got yesterday was the fed saying the only thing knew was they said there are some things that concern us about the -- whether this is sustainable. >> i was surprised to seat yield on the ten-year pick up on that. >> bond market took it as a positive that things would look -- but it looked like the best of both worlds. the fed looked like they were deciding that -- >> it sounded -- >> they also sounded like it was the most important thing was going to be jobs and -- >> we'll see that tomorrow. >> we'll see it tomorrow, but based on yesterday, it was a stronger than expected record. >> that will be good. you could see the jobs number will be good tomorrow, but the fed already said there are troubling signs which may keep us in a little longer than we thought. getting both again, maybe a better economic jobswise, but a fed not too itchy, you know, to

start pulling back. maybe just throwing us a curve. i think bernanke needs to start before he leaves and he's not going past january. >> right. >> competition is heating up in the private jet industry. new startup called wheels up is taking things to the next level. kenny dichter is the owner and ceo. it launches today. kenny is the founder marquis jet, the private jet company acquired by net jets in 2010. i figured you probably would end up trying to get back into this business. what you did for marquis, you took jet leasing, which was gordon gecko, remember, he said enough money to own a -- your own private jet, and you brought that down to wheregordon gecko a card and now you're going down further. >> i got to see up close how big the marketplace was -- >> for private aviation.

>> we did about $4 billion worth of those marquis jet cards and we also sold a billion dollars worth of fractional jets. >> people that could have never owned a jet or leased a jet from net jets. >> absolutely. we want to broaden the base -- >> even further. >> even further. broaden the base down. the niche in the market, i looked at it, bill boifter was the ceo of net jet columbus. he's now the ceo of beechcraft. we always talked about it. i said if we can do a sub $4,000 an hour product, took you two hours or less, the king air would be the perfect product. >> four people on it. you're not flying alone. >> let's certify it for nine people. equivalent nine person passenger jet -- >> turboprop. really not much different than, like, a -- >> absolutely. a turbo jet engine. >> we have a shot of the interior. beautiful. and you juice them up a little bit with wi-fi and -- >> we'll make them special. pratt, whitney canada, amazing

set of engines on the plane. the safest plane in the world. the military uses them. >> is there a way to get, instead of getting all eight seats and using those, is there a way to get a seat on one of these? >> different model we'll set up. we're setting up a membersh membership-based model. think of a $27,000 downstroke versus marquis, about 150, 160. >> what do you put down? >> less than 20. less than 20. and then have an annual subscription or set of dues, sub 10,000. you put that down, you join our club, you'll have access to the 105 kings that we'll take over the next four or five years. >> where do you get the money? >> it is not how much you have it how you borrow. >> beechcraft is helping, i guess, aren't they in. >> beechcraft is helping. they're giving us an exclusive. you have boifter and flick over there and johnson who runs the board, they bought in our vision

and believe we can do it. >> when the stewardess comes by, do they say do you want evian or juice? >> i can announce worldwide partnerships with evian and tequila -- >> so you are. you can. you can get -- tequila? they are making nice bathrooms, right? aren't you upgrading the bathrooms a little? a lot of kale juice, you'll be back there four or five times. >> we had great partners, joe. jeffries bank, richard handler, they make you feel like whether you're a dow 30 component or kenny d., they make you feel great. they're doing the debt for us. you have jim palin and nick fazioli, unbelievable. and david backs is our new president. >> how does it work? >> how do you get on a jet in if you need a jet -- >> the whole world changed, joe.

it used to be you bought one airplane, and one specific type and that's what you flew. today, think of it like i'm your wealth manager. 35% of your flights, andrew, will end up on king air. 20% light jet. 20% mid. 20% heavy and then we'll put something together called a private shuttle. want to take the kids to the super bowl, we take you there with the other wheels up members. >> i put down 20 grand. >> less. >> 15. >> let's say the opening membership, founding membership, $15,750. >> call it $16,000, another ten on dues. >> no pay the $15,000 today. the first time you get hit for dues is january 2015. >> then i pay hourly after that? >> you pay hourly but you have access to a fleet of planes you wouldn't have access to and the public doesn't have access to. you have to be a member. >> how many planes off the bat?

once you get up to full speed it is easier. >> we're starting in clusters on the king air side. we'll offer the total aviation solution, but we're going to take nine aircraft quick for the northeast. that will be between september 26th and the end of the year and our delivery cadence is fast. we'll take the first 35 airplanes, probably in the first 24 months, and then, you know, if the business races to form, we'll have all 105 in place inside of 48 -- >> what would it cost me to go to fly to norris town to d.c. t >> a thousand bucks per person. >> a thousand bucks per person. >> really only -- just down or down and back? >> 2,000 down and back. >> not bad. >> if you fill the plane, a great deal. >> at the end of the day, to

redefine, like we did at marquis, we redefine private aviation. we sold lia lot of that. the marketplace is two to three to four times what marquis was. if it is right, 10 to 15 members in the club, do 20 to 30 hours average as a flying in the years time, about120, 125,000. >>t marquis think about this? >> i got a lot of friends there. i think a lotould also h member. i know you have seven or eight golf club memberships. i alwaysoo the net jet pilots a richard santul warren buffett, i learned the game from those guys. so i'm -- >> this is -- we're talking luxury and even at this level, still a luxury and7.5% unemployment. but, andrew, building jets,

jobs, this is creating economy. there are people that will look at this and say, cnbc, they got bugattis, people flying around private. >> we're creating god. >> it is a sad day where we need to say this and actually -- it is not fair that some people get to do this and others don't. >> you can take the 2 million to the $7 million plane. >> thank you. good luck. still to come on "squawk box" this morning, quarterly results from dow component procter & gamble. we'll talk to the company's cfo at the top of the hour. plus, how is this for a ride? we have a bugatti parked out in front of our studios. the price tag, more than $2 million. we'll take a closer look when we come back. first, as we head to break, look at july's best and worst performing nasdaq stocks.

. >> the car defines auto luxury. robert frank joins us outside

the studio. >> you know, joe was talking about the velocity of money. this is the bugati grand sport, the test. it's french for insanely fast. this car is the fastest production roadster on the planet, starting price 1.69ple euros about $2.3 million before the add-ones, the custom paint jobs. they delivered one for $2.7 million. why is it so darn expensive? first of all, aside from the speed, it has a lot of technological features t. most advanced car in technology, it's 1200 horse power. the last was 1 now. horse power. this goes to 11. actually 1200 horse power. they had to add a lot of air intake here t. body is carbon fiber. i don't know if they can get a closeup of that. let's take you to where all the magic happens here, which is the

engine. it's a w-16 engine, so basically two v-8s, four turbos. 11 cash ray tors. again -- cash raters oo carburetors. the interior has cool features. the leather is made from high altitude cow so there is no bug bites on it. so we will start this up. now i will press the wing in the back here. so when you go over 150 miles an hour, this brake wing is going to activate and that lowers the car, changes the aerodynamics and allows 700 pounds of force to press down on the car so it

stays on the road. as i said, we're going to take it for a test drive. man, that engine is a great sound. guys, back to you. >> nervous, robert? >> hello. >> are you nervous robert about pulling out on this thing? >> i am a little nervous. this speedometer goes to 280. >> you got a deductible, right? even if you total it, it's only $500 bucks, probably. >> i don't know what the policy is. they should have a special pack for where you put your speeding tickets. they have a horse power reading goes to 1200. it's going to be a lot of fun. so we're going to take it for a test drive and come back. hopefully you guys can test it too after the show. >> awesome. do the cops know you are doing this? we have alerted the police. >> thank you, joe, they do now. >> at-a-boy. good. they're very understanding. get it flat out, robert.

robert is going to be, don't worry, it's okay. they told me that, you can drive as fast as you want. all right. we'll be back with more on that and jon moellor from frokter prd gam him. [ male announcer ] it' gamble. time to have new experiences with a familiar keyboard. . and share... faster than ever. ♪ it's time to do everything better than before. the new blackberry q10. it's time. the new blackberry q10. i've been doing a few things for playing this and trading.ove-- tdd#: 1-800-345-2550 and the better i am at them, the more i enjoy them. tdd#: 1-800-345-2550

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good morning, everybody. welcome back to "squawk box" here on cnbc. the futures this morning have been sharply higher. you can see right now that dow futures dropped by almost triple digits. up almost 90 points. s&p up almost 11. we will be watching that very closely. the bank of england is out right

now unchanged is the interest rate. a decision on that. we have been awaiting that. they're leaving the key interest rate unchanged at 0.5%. we are expecting to hear from the ecb this morning. in the meantime, other headlines, the nation's auto makers are set to release auto sales. edmonds is predicting a 15.2 increase over a year ago. the house passed a bill which would restore student loan rates. bill will now go to president obama for his signature. and j.c. penney shares are jumping. the retailer says it has been told directly by cit group, it continues to supply credit to its vendors. contrary to news reports yesterday that drove that stock down by about 10%. you see it's up by 6.5%. >> frokter and gamble is reporting 79 cents a share versus expectation 7 cents, 2 cents ahead.

this is a fiscal 4th quarter number. this year is done. the sales number was okay, too. 20.66 billion versus an estimate of looking at i think 20.553. so 20.66 versus 20.553. organic sales up 4%. that is basically what jon moeller has told us in the past well, it was within i think 3 to 5 is what they have been saying. we will talk to jon moeller the cfo in a second. we can talk about if return of bove to procter & gamble. i don't know if he's still interested. he will add new fish to the fry with air product. >> i did, i did. interesting story. also broken here. separately, speculation still swirling about a new fed chair. there was a meeting yesterday with house democrats on capitol

hill. president obama defended larry summers saying that critics aren't given the former clinton era treasury a fair shake t. white house says the defense wasn't an endorse him and adds the president won't announce bernanke's replacement until the fall. summers and yellen have been the most talked about names. on the hill yesterday, obama reportedly mentioned former fed vice chair don cohn as a possible -- kohn as a possible in the mix. does that mean december? >> i think it can be dropped as any point people were guessing it would be august. i would guess earlier in the fall than later. joining us is former minneapolis federal reserve kerry stern. also our guest host is bob nar deli the founder of accelerate. bob, it's great to have you.

gary, it's great to have you here. >> thank you, good morning. >> gary, very quickly, let's talk about what we were talking about with the speculation back and forth. is summers the better candidate? is yellen? is somebody else we're not talking about, maybe don kohn? >> i think without working very hard, you can come up with half a dozen very good candidates in terms of experience, knowledge, expertise, talent, all those objective criteria. then i think you got to go onto the confirmation process because as we have seen, confirmation in the senate these days can be very difficult. i think one distinction between janet yellen and larry summers is i think vice chair yellen would be a much easier confirmation process. larry summers, who is a very capable individual in my judgment brings more baggage. there is no doubt about it. i can't imagine why the administration would want to go through that battle unless they believe that he's the far

superior candidate. >> there has been this idea that he's worked within the administration and that, therefore, people in the white house feel more comfortable. >> it's possible that i think there may be something to that argument, that they're more comfortable with him. he, obviously, has some long-term allies, but, you know, you look at vice chair yellen, she's served in a variety of administrations in a number of posts as well as in the fed. don kohn, probably nobody can surpass don in terms of familiarity in terms of the issues in terms of his ability to express policy issues in a very articulate way. so i think there are a number of very capable candidates. it's not a bad problem to have if you are in the administration. >> i think that whenever you see the president's nominee's block, it's from the right. the right isn't the problem with larry summers. it's the right. the left will go with obama. i think you can get summers in easily. >> you could be right. but as we know, if you think about his tenure at harvard, he

alienated some. >> that was a false narrative. >> well, i'm not talking about the merits of the case, joe. i'm talking about the perceptions. >> harry reed came out and said he's a good guy and friend. >> that's a feather in his cap, i guess. >> you wonder about that. within i endorse summers, larry said, please don't. >> to the extent there is some form of financial krienks either abroad or in asia somewhere. do you think yellen can hand him it as well if not better than larry summers is famous for part of the brand to save the world? >> i think handling a crisis doesn't come down to one individual when you really take a careful lock at it. there ar lot of players at the fed, including some of the senior staff. there are players in the treasury. there are players elsewhere in the administration. i think we should, you know the fed chair has become a celebrity, maybe starting with

powell soek soek voelker. ed that good news and bad news. there is an overemphasis on the abilities of the individual. certainly, you want a capable individual. you should recognize the fed has an institution, has a lot of tradition. has a very capable staff, both in washington and the reserve banks, has global connections, all those things matter. >> i'd be interested in your opinion, again, all very qualified candidates. what weight do you put on the continue fewty of the current philosophy and policies from bernanke to those three? i mean, would you suggest we ought to kind of get someone who will stay with us? we don't have a dramatic change, more upheaval, uncertainty? what's your view on that? >> i think other things, equal continuity is important. both with don kohn and vice chair yellen that would not currently be an issue. circumstances change, of course. again, i wouldn't overrate continuity, you don't know what

the next major challenge would be. if we knew, we'd be great forecasters and we could prepare for it. more likely, some of the challenges will be maker surprises and so again i think you want somebody with broad experience, broad expertise, can use the staff effectively, et cetera. as i said, i think there are a number of people. we haven't talked about roger ferguson. i would certainly throw roger into the mix as well as somebody who meets the objective criteria and certainly in my opinion get the confirm. >> hopefully, not someone throwing up these trial balloons to see what sticks. >> that's not my business either. >> let's bring in former fed president al brottus. we have been talking about the succession issue. that itself the longer term issue. the more immediate issue, though, is what's happening with the economy. you say you would actually put money on the fed tapering in september. why is that? >> well, i think that's the best

bet, becky. but i won rule out december, either. i think they will make this first move clearly when there is a press conference. so for the remainder of this year, that means september or november. i would put it 50-50. a great deal depends on the points and the september meeting. we will have two labor reports. big reports. one tomorrow, another one at the end of august. so that will be a key factor. also, you know, we have been looking at inflation concerns recently. got signaled fairly strongly in the statement that was released yesterday, so i think that will be a factor. if that sort of goes away and you begin to see a more normal enflakes performance, both with regards to inflation itself and inflation expectation information from things like break even spreads, then i

think, you know, you get something like that with strong labor market reports, you may see it in september. if you don't, i think it will go the other way. right now, i put it at an even bet. >> an even bet for december. it depends on what's happening in the real economy. are you out there every day, what do you see? >> i look, these two gentleman know a lot more about it than i do. i would put my money on december. only because if you look at the unemployment rate unchanged, if you look at the forecast, certainly many of the ceos are very conservative. we're going to hear from, we heard from png this morning. i think the reports are mixed. i think there is concern of the uncertainty. i don't think you will see a lot of re-investment in the short term. i would project more december tan september. >> all right. al, i guess the biggest question is what happens with the unemployment rate. if that number comes in tomorrow a little better than expected, say 200,000 in terms of the jobs

number, is that enough for the feds to really feel comfortable about things? or do they need to see serious outside performance? >> definitely, i think that will certainly make them more comfortable. again, becky, you got another number before the fomc meeting in september. and then that will have way -- have weight, too. if this gets diminished. if you have a stronger report tomorrow followed by a strong report at the end of the august, i think that makes a move in september feasible. the comment i just heard makes sense, it could well be december. i would not rule out september if you get strong numbers. >> the jobs report, it will be interesting to see, you know, last month, the part-time workers went up almost 300,000. so you got 8.2 million people part time so again, we have some seasonality that we have to put

some logic into, becky, i think, as to whether these are full time and sustainable or they're the seasonality on some of the big boxes in retail an entertainment. >> bob is our guest host. he will be staying with us the rest of the morning. al, thank you for joining us. gary, thank you for coming in. >> good to see you. >> up next, jon moeler on the company's latest results. "squawk box" is being after a quick break. ♪ [ male announcer ] you wait all year for summer. ♪ this summer was definitely worth the wait. ♪ summer's best event from cadillac. let summer try and pass you by. lease this cadillac srx

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. >> png reported earlier, let's talk more about those results with someone who should know jon moeller cfo of procter & gamble. a number of cnbc member of our cfo council as well, john. >> i am. >> that's first on your business card now. how would you characterize, so far from what i can tell, revenue were above, earnings were above. most of the organic sales growth was in line what you said, mid-point range at 4%, wasn't it? >> it's 3 to 4. we're at the high end of that range for the quarter. we are over on per share. very strong volume growth, 5% volume growth. market share increasing as we

went lou the quarter. as you know, we just completed our fiscal year. a pretty good fiscal year. a good stepping stone, leading our industry, generate free cash flow, return cash to shareholders through a combination of dividends and share repurchases. >> the outlook i do see has to do with organic sales forecasts for next year. it consists with the end of the fiscal year. go over the outlook that you gave for organic sales growth. is it above or below where it had been? >> this is the first time we've provided organic sales outlook. >> versus what you are expecting in this year i meant a? >> this year went in expecting 2 to 4. we are expecting 3 to 4. on market growth, that's about 3 to 4 as well. ahead of last year inline or ahead of the growth of the market. >> all right. and how would you characterize

the, how it feels at png now with the chains at the top and bringing back ag? >> well, frankly, it's felt good. it feels good. i'm very optimistic about if future as we look forward. obviously, ag worked with this team. it's great to be working with him again. we're committed to serve consumers and create value for consumers and shareholders. >> did he hire you? how long have you been been there? >> i have been here for about 25 years. a.g. and i worked together in asia a long time. we worked together on our beauty and health care business. he was the person that asked me to take on my current assignment. >> oh, this is god for john. >> and good for us. good for everybody. >> it's good for everybody. >> what can you give us any concrete steps that have been taken so far to address what may

have been the, you know, whatever people like ackman or others saw as a problem with his predecessors running of the company? >> well, i think the biggest complaint across the shareholder base or the biggest opportunity that they saw was for us to reduce costs even further. we have a very profitable business. there is opportunities to improve that. we've made very good progress along that line. we're on track or ahead of most of our productivity goals. we have reduced the size of the organization by about 7,000 people over the last 18 months. and it started to come through and the bottom line, we overdelivered each of the last four quarters, largely driven by that productivity. >> did lastly add a t to cincinnati? he didn't, that's not a new, it's still one t, isn't there or is there, okay, maybe -- >> we have been pretty busy focused on the business. some of those details get by zblus it wasn't you.

it wasn't you. go ahead. >> hey, john, bob nar deli here. how are you? >> i'm good, how are you? >> a.g. the a charismatic leader, did one heck of a job. i know you will get the costs out, that's what you are about with a.q.'s leadership, his focus is on core growth an innovation. tell me what's happened since he has been back about juiceing innovation and the focus on the core. giving you that top line growth gives you a lot of leverage on the cost side for sure. >> absolutely. we will be talking later on the call. a.g. will be talking about investments, targeted investments behind innovation and our market capability to continue to grow the top line. as you know, a.g. is very focused on serving the consumer and on meeting consumer needs and to the extent we can do that even more effectively. there are huge opportunities for growth in this business.

if we focus on serving consumers and do that in an excellent way. >> domestically, how is the consumer? >> it's not bad. we actually had a great quarter in the u.s. we grew organic sales 7% in the u.s. on volume growth of 5%. so we're seeing a strong consumer response to some of the innovation we brought to the marketplace. some of the tweaks in the value we made in the marketplace, we're very fortunate actually to be domiciled here to have this be our home market. it's the fastest growing developed market t. largest an most profitable. we're the largest company competing in that space. so we're pro -- >> jon, i want to raise the issue of ackman again. he's sort of gone away in your situation a bit now. he's on the case with their products and on the case with herbal life. how do you think now that you have experienced or been on the other side of ackmanor or

activist more generally, how should companies deal with this? >> well, i mean, first of all, i think activist can be very constructive. they can increase the markets, they can potentially unlock value. on the other hand, they can be destructive if their time lines aren't in line with the rest of the share holder group or the natural cycle of the business. >> is there a lesson from your experience in all this? >> the lesson is very simple. do your job, serve consumers, create value. >> but when they call, do you take the call? do you say, talk to the hand? what do you think the right thing is to do? >> absolutely the shareholder is a shareholder. they are very important to us. >> hey, jon, another question on the business. you know, one of the best ways to reduce our trade deficit is to, you know, work more, move product and services international. if you look at the trade deficit, a big part of it is the result of manufacturing, yet services are contributing positively. how do you guys think about that

as a business and also helping our economy? >> well, we, the economic modem of our industry really requires that we produce as close to consumption as possible. a delivery and transportation is a big component of our cost structure, bigger than manufacturing, actually. so we import very little product into the u.s., most of what is consumed in the u.s. is produced in the u.s., similarly, most of what is consumed in china, for example, is produced in chosen. that's just dlimp by the economic fundamental also of our industry. >> tom, i know you are looking all the time to find ways to become more efficient. there was a story about procter & gamble moving the amount of time it pays its suppliers and vendors to 45 days. is that accurate? >> we are increasing the payment cycle for vendors. we are doing it in conjunction with financial institution, so it's a win, win, win, they actually get their cash sooner than they do today. we pay later. because of our credit rating,

we're able provide financing on a very -- basis. suppliers have been very receptive and encouraged by this move. >> all we can know with p & g's experience, would they be able tell if there was a change in how quickly the region was growing? >> yeah. there definitely has been a clang in several of the developing markets, china and then not surprisingly so closely related in terms of proupth products in brazil. but still, growth rates are very attractive, high single digits to 10% in china, across all developing markets, very strong, high single digits. so we continue to see developing markets as another growth sector. hasn't gone away. >> in europe, too. that's gotten better than a year ago, you would think. >> europe's essentially the same in terms of demand for products

in our product categories. it's somewhere between-1 and plus 1 depending on the more than. >> we appreciate it. a.g. has been on a few times selling his book. he doesn't just come on for the heck of it. we got jon there. delegating. >> that's right. well, you know, if he wants to you know he's welcome. you know. that pass it ont. you both come on. you could kiss up to him while he's on. all right. see you later. thanks. >> on that note. when we come back, celebrating the musical talents of jerry garcia. it's his birthday, we caught up with the grateful dead band member bob weir. then we take a spin on the world's most expensive car. not us, robert frank is. it's here. he has a special guest to talk

sales and what this means for bugatti and what makes it so special. "squawk box" will be right back. and experience the connectivity of the available lexus enform, .

. >> coming up next. the challenger jobs report. a rate out and the world's most

expensive car. it's here, we have the sales director of bugatti in just a bit. the futures right now. take a look. we have green arrows. the dow looks to open a few points higher. back in just a moment. [ agent smith ] i've found software that intrigues me. .

. >> welcome back to "squawk box," everybody. let's take a look at some of the stocks on the move this morning. dow component procter & gamble reporting a profit of 79 cents a share. 2 cents better than the street was expecting. revenue a big conconsensus. this was the first report. component was up about 1.1%. also, beazer homes, a smaller than expected loss. like other home builders, beazer is seeing higher than average sales prices. it expects to return to profitability this quarter. also, j.c. pen fisays cit group

said it is not cutting off credit to suppliers. is contrary to news reports out yesterday. the stock was down 10% yesterday. it's up more than a dollar, a gain of 7% this morning. >> let's talk about the employment picture. jobs cut slightly in july. joining us to give us an update, john challer and steve liesman at theible that. topping for being here, both of you. i was going to say, steve, since are you sitting next to me. >> thank you for being here. >> i'm back in the hot seat. in a big way. john, walk us through the numbers, they were, i don't want on the say, better-than-expected. we did have a decline, which is good news in this case. >> yes, certainly the numbers were light. just over 37,000. job cuts were announced in the month. that was down 4.2% from what we saw last year then that we've seen now just under 300,000 job cuts for the year down 7.3% from

where we were a year ago. so all in all, there's not a lot of pressure. companies are putting on their work forces. >> john, the biggest industry that seems to have taken a hit is health care. why? >> interesting is seeing healthcare seeing cuts, 1643 were announced. that was the largest we seen since november 2009. there seems to be a lot of pressure growing on hospitals, their patient volumes and stays are down. they're not getting reimbursements from medicare. medicaid payments are coming down. so hospitals are taking action now. maybe out if front of the of health care reform. also responding to what's going on in cutting jobs. >> is there anything to be said about obamacare in that conversation, given that's been pushed off now a year? >> well, we're not seeing a lot there. there are some companies that seem to be, now, not in the hick heck sector, some companies -- in the health care sector, have made spotty announcements of going to temporary workers to

cut their hours down and avoid some of the obamacare kind of issues. >> steve on the health care, is this a good news/bad news kind of issue intha clearly health care costs are coming down, right? >> there seems to be some downward pressure both exerted by the economy and obowl care, early days on that. >> what are your concerns? . >> i have my concerns. i think we were the first on "squawk" to peg back the adp report versus the 50 and older. the notion that -- i'm still reporting this city, there is no good evidence -- that people may stop tear hiring of 49. i heard last night this idea that you can take a full-time worker, create two part-time workers and avoid the, whatever it is, some of the costs of obamacare. that troubles me. again, i'm not seeing evidence in the data yet. there is some notion, looking at the adp data that 50-plus have slightly lower growth than 0 to

49 of the past several months. not statistically huge, something worth monitoring t. anecdote alda that is how you might see it. you might see it part time for economic reasons. john, you are also, other than what you check here. you are also anecdotally talking to people and employers. what are you hearing will? is it possible they are limiting their hiring if you have 49 employees? is it possible they're splitting up part-time jobs to avoid some of the mandates? >> yeah, i think probably not yet, but going forward, companies that are near that line most certainly will take a hard look at that. if you think about it, if you have 49 employees, you got to pay the 2,000 penalty that may go up in years to him co. those companies will be very watchful of their nut and have to take action, it seems to me. >> john you had some defense cuts, you think those are sequester-related. >> we did. we saw 489 cuts there. 22,750 for the year.

it's up 20% this year. total aerospace defense cuts over what we saw for all of 2012. i do think those are related to some to the sequester, some that just generally the shifting of military strategy we are seeing now in the u.s.. >> john challenger, thank you for joining us this morning. >> thanks. >> steve, you have other news. >> 71 today, people are celebrateing. half of -- >> it's a tie. >> half of wall street was at woodstock. right. the other half is sort of -- >> running the government. >> the other half claim to have been. >> claim to have been or thought they were. >> so i got to -- >> we love tony mitchell's performance there. >> dead was there, they won't ever let it be released. apparently, they didn't play very well. stories, we got a chance to ask bob weir. we have questions about remembering jerry on his birthday. i asked him for a single fond memory. here's what he said.

>> we were just chugging away. nobody was taking a lead. nobody was soloing. nothing. and so i sort of edged my way over to jer i. this is nice. he wasn't going anywhere. he was just, man, i could just live here forever is what he told me. i remember that fondly. >> the fiddle of it, he had a conversation with garcia. i asked him another question, i said, are you surprised the music has endured so long? it's 24/7 on sirius. bob weir does a weekly -- here's why i think he said the music is endearing. >> it doesn't surprise me. there's a lot to this stuff. it wasn't written for the purpose of selling a million

records or, you know, appealing to the current trends in popular music and we had no talent for that. so we abandoned that early on. >> so don't try to be trendy. this is the latest thing they're doing here, andrew. warren haines and the almond brothers are working with the san francisco orchestra to put the grateful dead music, make it symphonic. it has these different permutations and stuff like that. take a listen. ♪ ♪ . >> all right. i guess that have this with the symphony. that's from the studio last night. tonight he's playing with the san francisco symphony. cool stuff. >> how are you? >> we have many, i'm afraid of what people put into it. >> coming up, it's a little less fun but we got a decision on interest rates across the pond. we will hear from europe's

central bank and get market reaction. plus, check out shares from webmd. it's doubled year-to-date. we get earnings, their diagnosis from the company's ceo next. . coming up, it's got the clout tag of the world's fastest and most expensive cars. it's also got the price tag of about $2.5 million. we go behind the wheel of the bugatti grand sport and talk sales expectations kwen when "squawk box" continues.

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. >> welcome back. pgg is up about 109 or so. yeah, png beat expectations on the bottom line and top line. also getting a little bit, raising the lower end of its organic sales guidance for next year. since this was the end of the fiscal year. >> all right.

health information website webmd a penny below the forecast on the street. it reverses a year ago loss. revenue up 11% thanks to a boost in demand. joining us to talk about those numbers and how his company plans to address the affordable care act is the ceo of webmd. >> thanks for having me. >> looking back at the advertising situation. big pharmaceutical companies have been averaging less over a year as they were all the competition that came if from generics. how did you get them to come back and continue advertising? >> i think the negative evenlgs of patent expirations on block buster drugs are behind and the environment is much improved t. robust pipelines going forward. they're showing they're willing to spend more on advertising promoting tear products. >> so they were cutting back getting through the hardest parts? >> exactly. >> with them coming back, do you

think this is a trend that will continue for some time? >> yeah. we have a few quarters where we seem positive momentum in the business. it's our biopharmaceutical customers. we are very optimistic the trend will continue. >> what about traffic trends in terms of people checking, every person sitting around this table. every time they feel sibling, every time they have a stomach ache, a mole that looks out of place, they jump on webmd. >> we have been successful in growing our audience consistently over the years. we deliberately made sure it's a multiplatform offering, so we've invested heavily in mobile. we have been able to grow our audience. >> how much comes in on mobile these days? >> about 30% comes from a u.s. smart phone device. >> how does that compare with just a year ago? >> it's grown from a year ago. consistent with the trend in the internet, our traffic is, you know, a lot of growth in our

traffic is coming from mobile devices. >> you also announced you are getting rid of the stockholder rights plan adopted in november of 2011. why is that? >> well, the board determined it wasn't really necessary, any longer necessary. they put it in place when we were experiencing very challenging times with the company. >> so at that point some activity was taking place, now you feel that has gone away? >> well the stock, the board at that time made a determination that putting in place a stockholders rights plan was a prudent thing to do. >> you think there is no need for it at all? i sometimes take issue with some of the shareholders rights plans. >> it really was a board decision. again, they made a decision it was no longer necessary. >> real quick. ecb unchanged, i don't think there was an expectation, worth pointing out the number is unchangeled, left at .5 for now. >> david, if i can ask a

question, what would be interesting to me is the intelligence of your backbone. what do you see as the emerging questions or trends people are asking for and how do you track those and andrew and i were talking about getting online to determine sleep and sleep remedies an so forth. what do you see as the emerging trends people are asking about now? >> webmd is a comprehensive an ro bust experience around all health care decision-making, we try to empow decision-making across the continuum of issue, increasingly lifestyle issues. half of our track is what we call lifestyle or wellness areas, so the new affordable care act, we just launched a channel just this week is another example where we feel it's a part of our mission to empower decision making that people will be faced with around health care reform. >> do you see yourself, we were talking about this jawbone, this

thing i wear on my wrist which measures everything, now, there is a whole number of them on a single base basis, do you see yourself getting into business either making products like this or somehow integrateing your product? >> it is an important part of our strategy, webmd becomes the central place where people store the device data. it can become actionable. we can make the webmd experience much more robust and personalized if we have access to your device data, data you collect on mobile apps. we are in the process of developing those capabilities and the first iterations as will you see by the end of this year. >> david, is there a tutorial on there that helps you exlane your symptoms in more medical terms? >> well, we certainly have a tool which is a popular tool on the site which helps you understand, you know, based on the symptoms you load into the tool what you may be suffering

from. >> right. very helpful. >> a big part of our mission is to make sure people are prepared for the doctor's visit. >> right. >> david, thank you for coming in. >> thank you for having me. >> you didn't get to read all the tabloid stuff on vacation? >> i was trying to avoid tabloids. >> are you up at all on -- >> this wonderful program. >> are you up at all on weiner-gate. >> a little bit. >> what do i need to snow. >> there were some interesting disclose years out yesterday. i was thinking if you could get anthony to wear one of those wrist things. thing would be like on the richter scale, it would be like all day long. whew, whew, whew, and stop. you read what the girl said? you know she met with steve hirsch the leather, what's her first name? >> sydney leathers. it's going to be a -- >> it always goes there. >> well, i mean, it's not like

yours don't see any activity eitherer with that thing. what itself the yellow one? >> jogging. >> oh, jogging. >> oh. didn't look like jogging, the way the camera -- >> coming up, don't do that. someone will take that out of context. you will see it on youtube. coming up, the world's fastest and most expensive car is here, robert frank is outside. he joins us now with a preview. robert. >> yeah, one thing i want to point out, thee titanium grills are designed to w stand a bird strike at more than 250 miles. at that speed the birds can't see you. we will talk to the sales chief about who is buying the $2.5 million and the one client that has more than ten of them. back after the break. .

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>> back if one piece. cnbc's robert frank is outside with a special guest. you look all right. the blood has drained from your face. >> i feel like i'm on drugs after that test drive. it's amazing. we are here with john hill the sales and marketing chief of bugatti north america. john, a lot of people, a $2.5 million car. sounds insane. what is the goal and mix of this car and bugatti? >> when we first acquired the brand back in 19 make the, our

chairman met with the engineers. he gave them four instructionsment he said, i want you to build a car with over a thousand horse power. 0 to 100 kilometers per hour, less than 3 seconds, top speed over 406 kilometers per hour. that was based on the fastest speed recorded at le mans. all of that, you have to drive it to the opera and not be embarrassed. don't build a beast. build something that's beautiful and elegant as well. >> beauty and the beast what you call this. who is buying this car. what is the typical pro fight. you got to be super rich to buy a $2.5 million car. >> predominantly male tfx age range is very broad, my youngest customer was 23. oldest is in his 70s, but they're very similar in a lot of ways.

they both love cars. >> are these entrepreneurs, 23-year-olds who are saudi oil princes? where do they get their moinl? >> in north america, they're predominantly individuals who have started companies. there are some high level executives as well and a broad range of industries, anything from i.t. development, construction. >> now, let's talk about when something happens with this car. if this breaks down, you can't bring it to the snow co. it's more like an aircraft than a car. how do you get this repaired? >> well, i should start by explaining we have a telemetrics system in this car. it's always communicating with us, we know oftentimes before the customers do whether there is a technical issue with the car. >> telemetrics meaning it is always sending back da-to-the company. >> yes, every car in the world is monitored.

we can do it from a number of locations, we have bugatti technicians in california. >> they fly in a repair crew and fix it or what happens? >> we have 12 dealers throughout north america. they can do all maintenance and many repairs. if there is an issue that can't be handled locally, then we have our flying doctors who can travel anywhere in the world. >> how many of these are you selling? >> we will only make 150 of the open top car world wide. we estimate about half of them will be the 1,200 horse power version of the test. >> got it. >> about 25% of all of our numbers end up in north america. >> a very exclusive group the car, the 1% of the 1%, joe, back to you. >> no clutch, robert? >> no clutch, padments. >> is there a trunk for golf clubs or not? >> no, there is a little space under the hood, a multiple top that goes here. maybe you can fit. you can't fit a putter in there. maybe you fit your wallet in

there. it's not a ride to two to the fwofl course. >> if you buy that car, you can't fit your wallet. >> you probably need a second car to bring your golf clubs. >> thanks, robert. coming up, former aetna chairman and ceo ron williams, exxon mobile earnings are expected at the top of the hour. skwaux "squawk box" is coming back with a very big hour. tomorrow on "squawk box," we wrap up a big week of data points with the july jobs report. expert analysis from market pros and economists all morning long, plus, the chairman and ceo of autonation, delaware governor jack markel. former economic chairman austan goolsby. it all begins at 6:00 a.m. eastern right here on cnbc. profit from it. [ male announcer ] i've seen incredible things.

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. >> earnings central, dow component exxon mobile set to post quarterly results. plus a squawk master joins the conversation. our news maker of the hour. and breaking economic news. weekly jobless claims just about 30 minutes away as the final hour of "squawk box" begins

right now. ♪ . >> this guy has problems, too. >> who are you talking about now? >> it's quite complicated. the guy from oasis the baby mama, it's pretty deep. welcome back to "squawk box" on cnbc along with simon could, good almighty. a crazy story that is. first on business world wide, i'm joe kerrnen and becky kwivenlth our guest host is robert nar deli founder of xr 8 accelerate. you say accelerate. it looks like it's accelerate. it's actually xrl 8. it's like a license plate. did you see all the ones you can't use? >> yes, i did see.

becky was your first headlines, you don't have allegheny county about simon could. >> nothing about anthony weiner. we do have two interest rate decisions. the bank of england leaving its q3 interest rate unchanged. the european central bank keeping its key rate steady. the ecb chairman will be holding a news conference at 8:30 eastern time. we will be monitoring that. in corporate news today, earnings from procter & gamble beating the street by 2 cents, revenue talking consensus. cfo jon moeller on "squawk box" talked about the torino he sees. >> i don't think that's the number. i'll wait a while. >> let's listen from cfo john moerl told us on "squawk" this morning. >> frankly, it feels good. i'm very optimistic about the future as we look forward. obviously, a.g. has worked with this team for many years.

it's great to be working with him again. we are committed to serve consumers and create values for consumers and shareholders. >> this was procter & gamble's first quarterly report since a.g. returned as ceo. >> if it's from the company, it's from the company reportedly $1.45 for exxon versus estimates of $1.90 that would be a big miss. that's either the analysts problem or the company's problem. we'll get more data on the supposedly, there are no extraordinary items in that number. it's always hard to come up with a revenue number, if i could, for exxon. for years, we've had issues with how to do. obviously, we're working off of headlines, the headlines that the company reads. they don't put their press relows out in a timely manner. exxon is the one company, we hear about the earnings per share number. we look at the release. it comes much later than the

headline numbers that come out on this. it's a bit of a guessing game. >> the stocks, normally, you are looking for exxon at, you know, how much they've replaced. things like. they said the second quarter, they spent $10.24 billion in capital expenditures. they're spending a lot of money to beef up the system. we are working off the headlines, not the full release. >> exxon, this is $6.9 billion is what they're making. many times in the past with quarters, they've done $10 billion in a quarter. >> yeah, the revenue that they came in with was $106.5 billion. >> you know, the price of gasoline has not reflected the price of crude for a while. so that would mean that your favorite item there the crack spread has been probably not favorable to the bottom line, because they haven't been able to charge at the pump, so that

would be a down stream issue versus an upstream. it's such a diversified giant. obviously, exxon, it's got all these different operations. >> all right. i've got the release now. wow. again, capital and exploration expenditures were $10.2 billion in the second quarter and $22 billion for the first six months of 2013. that was in line with anticipated spending plans. second quarter earnings, they say weaker refineing margins, joe, you were pointing out, planned refinery turn around and maintenance activities negatively impacted the earnings, that is the case coming up for the company. >> there you go. earnings per share, again, $1 pin 55 a. device of 55%. >> 57%. last year, it had a gain of $7.5 billion with tax-related items, if you in fact have the gain from last year, it's still down

19% which is wrong way again. are you not supposed to go down year over year 19%. it's not as bad as the 57% looks like. >> the oil equivalent production down 1.9% in the second quarter of 2012, exclouding impacts of entitlement volumes. >> i'm still a little surprised analysts can't figure this out any better than. >> the dividend, though, this is interesting. it was 63 cents. that's up 11% from the second quarter of 2012. so that dividend exploration 63% up 11%. >> in the market it's down a dollar or so. not like it's down $5 by missing -- >> exxon mobile is not one where they traditionally hit the nail on the head. this is a much tougher company to pick, though. >> if i can figure out that gasoline prices haven't reflected crude prices, why can't analysts figure out, why can't they figure out there will be problems in the refineing

stuff? i don't know. this is the dow component procter & gamble is sharply higher now. exxon is now down. so i would imagine that in the future you'd see they'd be back up from 109. let's take a quick look at the dow futures,' fe we're not up as much as exxon will factor into it. >> the numbers are so big, though. >> they come down two points. >> they're up 109. >> i remember being up 105. >> bought back 4 billion in shares during the quarter. every single metric, every number. >> yeah, $4 billion is on a mark cap of 416 which is now -- >> the numbers are also very big. >> is it being to number one now? apple is now 411. so that's number one. >> also, keep your eyes on shares at j.c. penney today, the retailer said yit told them directly they are not cutting off penney suppliers.

is contrary to news reports yesterday. you see that stock up almost 6%. it was off almost 10% yesterday on those reports. we will see how things wind up later in there we are waiting for tomorrow's july report. challenger releasing its monthly job cuts. number came out in the last hour. it reports the planned job cuts declined 4.2% in july. john challenger joined us earlier this morning. >> certainly, the numbers were light. just over 37,000. job cuts were announced in the month, we've seen now just under 300,000 job cuts for the year down 7.3% from where we were a year ago. so all in all, there's not a lot of pressure companies are putting on their work forces. >> that comes after that big number we saw yesterday from adp, which was a much stronger than expected 200,000 gain and private sector jobs in the month of judgment t. tomorrow's consensus is 183,000. at 8:30 eastern today, we get the weekly jobless claims, first

time filings are expected to come in at 345,000. >> joinings now is mark freedman, chief investment officer at westwood holdings group. the chief global economist at standard & poors. exxon almost remind me of the gdp report. don't pay attention to it. it's not real. is that sort of the same thing? >> well, i'm an economist, joe, i'm paid to look at gdp reports. >> was it a one off yesterday? >> i don't think it was a one off. obviously, we had the big revisions going back to 1929, gdp history rewritten here. >> we will include movies now. >> i think what is a little concern here, joe, is that we had three-quarters in a row, sub2% growth. this is 1.7. >> we add back one for the sequester, don't we? >> i think this is a part of the problem. gdp growth is trending at 1%

quarter on quarter. now, that's not very good. >> it will feel like qe 3. >> qe 3 is helping offset what is a fiscal drag. that's the point. direct government spending. think about the indirect impact to government, tax hikes, for example, again this three-quarter average 0.7 percentage points. that's a significant fiscal drag here. you got one foot on the monitoring accelerator. you got one foot on the fiscal break. >> yesterday, when were looking at the numbers, we kept saying, number one, we didn't foe if it was good or bad. number two, we don't foe if it's good or bad. is it about the feds staying in or hoping that the economy gets better. what makes the stockmarket go up? it's been keeping the fed in. it's been more important than a growing economy. have we made the transition yet? >> no, we have not made the transition yet. so, we're in the process of it.

i remember your comment yesterday, you said, look, here's the economic data. we don't know what to do with it. is it good, is it bad? it will persist a little longer until we get the collarty. but after that transition, you know, it's kind of hard to remember this, because it's been so long. i think we will go back to an environment where, look, good economic data is going to be good for stocks. it's probably not going to be few for bonds, then negative economic data won't be good for stocks. it will be positive for bonds, it's been a long time since we have been if that environment. we got a little ways to go to get there. >> mark, the other thing, in previous, for the past three years, we had these swoons that were worrisome for lot of people. this time around it's like don't worry about it this time. we're on track, right? this time we are kind of on track. we are in a different place. we're in a better place than we had been recently. should these, what paul just

talked about, those three straight quarters below two, should we be questioning how sanguin things are that they will get better? >> i think from a risk standpoint, we have to take that into consideration. where we are today in an expectation is 180 degrees from 2011 or many kefl 12. if we were having that conversation at that time, you couldn't convince anyone things were getting better. today, that itself consensus. in the fed statement yesterday, they are setting that expectation. they explicitly state they expect things to get better as we go through. so it's now a question of the data the economy has to come through and validate it. >> in the past, i said that wires me. all of their exit strategies are based on being able to bring unemployment down to where they can exit. if they don't and if there is a bump in the road, then they can't exit. >> i think that's the key point,

joe, the.is the that the fed is really underwriting this recovery. that was submitted last december an september. they said, look, we are aggressive. we are impatient with this koefr e recovery. we will get a recovery. we will calibrate the economy to achieve it. i don't think you should see it as qe coming to an end, it's a shock the fed moves. the fed will only do that stuff if it's confident. they went they are not affecting fiscal policy. >> maybe what they are doing doesn't work. >> it doesn't match the numbers. i think from the business community, we'd rather see a sustainable robust gdp. within are you under 1.7, one point adjusted, that number doesn't match the optimism we heard. that's why i said, if there is an ad judgment, it will be later in the year. the unemployment rate to support that from the business community. >> we got to go.

again, mark, i'd appreciate your time. you are still buying. you are not selling everything. how much money are you managing out there, a lot? >> exactly right. if i make one quick point, uconn trafted, p & gr an exxon. p & g had top line growth. going forward, companies that create top line growth they will be rewarded. that's one of the things we are focusing on. >> thank you. okay, coming up, former aetna boss ron williams will join us to talk about health care. first as we head to the break, check out the quarterly results, procter & gamble beating the street. exxon earnings falling short of estimates, you can see those stocks moving in two different directions there. ts, customizable charts, powerful screening tools, and guaranteed 1-second trades. and at the center of it all is a surprisingly low price --

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. >> welcome book to "squawk box," everybody, chrysler is reporting an increase in july u.s. sales, that was in lean with estimates. it was chrysler's best july in seven years. the other auto makers will be out with overall sales expected

to be up more than 15% from a year ago. bob nar deli, strong numbers, auto industry coming back. >> i couldn't be more proud of the chrysler team. there was an interesting article joe was reading about chrysler, how they're bailing fiat out. what an irony. >> i don't know, kind of an irony. i mean, fiat. i never had a great impression of fiat. >> they got some cool cars, though. >> my point is chrysler could have been a free standing successful enterprise, i'm proud of what they've accomplished. >> i forget, there was on the road dead, something for fiat. >> mixed again. >> we're going to talk health care and jobs right now. the white house refuting reports the restaurants are limiting hours due to the affordable health caring a. the administration says they are hiring at a faster pace than

expected. ron williams is now chairman and ceo of r.w. enterprises. good morning. >> good morning. >> let's start with the premise that the white house is suggesting that actually restaurants and other types of jobs not coming down is actually going up. you don't boy it? >> well, i would say i think it all starts with each enterprise business strategy. i think the employees at risk of having hours reduce reasonable doubt those who are working 31, 32, 33 hours to the extent that the cost structure of the business would increase substantially. i think the administration is probably right as a result of the decision that they made, which gave employees an extra year to sort this out. >> but do you -- the white house may be right to delay obama care in those markets, but or the larger market, but in the bigger issue of whether we're actually seeing that jobs today. >> well, i think that it is a

big issue when you re-define full-time work from 40 hours a week to 30 hours a week. and i think my belief is that it will have an impact if that regulation is, in fact, implemented a 84 from now. i think what you are going to find is a lot of ceos will not talk about their strategy as it relates to that, but everyone will be looking at their cost structure. their decision will be based on their business strategy and what their customers expect in terms of service. >> hey, ron, bar nar deli. thanks foring with us. >> i was at the stock exchange, they were talking about aid fordable care act. last month, the average workweek was 33 hours. to your point, i think we will see a trend to reducing below 30. particularly, we spent time talking about retail business the large retail, whether young brand, home depot or lowe's.

i think if you would like to comment on that again, i think it is going for a negative impact. we saw part-time jobs increase 388,000. you got employees working part-time now. >> well, i think i would start with the fact that we have a very serious unemployment problem in the country and if you look at it and really begin to segment it out, what you see is that at 7.6% for the broad population and are you talking almost 14% for the african-american and about 9 for the hispanic, youth unemployment is an absolute disaster. so i do believe that anything that results in a reduction in the hours worked will really impact the various people we are trying to help. >> i noted this when it happened. it was about three or four days ago. the white house definitely in their mind wanted to address what we're going to see this friday and they came out and previous emtively said and made

a big deal out of it that if you do see more part-time workers this friday, it has nothing to do with obamacare. it has to do with the sequester, because all of these government employees are now either on leave or temporary. so so them, i mean, can you imagine if they ever did really concede that their most important priority in the first two years of this administration, if they ever did concede, that's been hurting jobs, that would be a huge thing to admit. but, in fact, a lot of things point. that way, that maybe jobs should have been the priority right from the day one of the first administration. and it wasn't. >> well, i ploo everybody that one of the things i think our leaders can do, both the president and congress is get back to saying that one of the most valuable things that young people can do is actually create a job for someone else. and i'm all for public service. i am involved in numerous philanthropic activity.

i think we need to get back to the single post-important thing is create jobs for people. >> obamacare is supposed to add jobs. at this point can you honestly tell me it has not been a negative for the jobs picture in this country? >> no, i think that my opinion is that it has created uncertainty along with a lack of broad scale consumer demand. i think it's been in that negative would be my opinion. >> let's talk about the good news, bad news on what's going on in the health industry. this morning, we had john challenger on talking about where we seen declines in job growth. health care was actually the industry hit the biggest. you could say that's bad news in terms of just lost jobs. you could say that's good news in that we are spending, historically spent too much on health care. how do you see it? >> well, i think in health care it's not what we see, it's what we get. if we were convinced we were getting real value for every

dollar that we spend, we would be glad to spend more money as a society i believe. i think the problem is we know there is huge waste in health care and that a lot of the work is under way. i do think this has been one benefit of the affordable care act is it has legitimized the transformation of the health care system. now the employers who actually pay for health care for their employees have long been advocates for this and have really wanted to transform the system with information technology, focus on quality, focus on evidence-based guidelines. so i think that that's how i see it. >> ron, real quick. medicare costs, they have been growing a lot slower than some people had expected. what do you think accounts for that? >> well, i think the fact that the government has the ability to set the rate and reduce the reimbursement and to shift some of its costs onto the private sector, gives medicare some tools that the employer community does not have. >> okay. >> ron, you've got some great

ideas on job creation. can you cover a few of them quickly, if we have time? >> yeah, a few things i would say, one i believe that getting our tax policies straight would be fundamentally important. we have almost $2 trillion trapped overseas in investments. money could be brought back and help support the creation of employment opportunities here. >> john, thank you for joining us. we got to run. we have da-to-get to. we appreciate your perspective. t and choose from one of five lexus hybrids that's right for you, including the lexus es and ct hybrids. ♪ this is the pursuit of perfection.

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. >> coming up, breaking economic data. as we head to a break, u.s. equity futures up 110 points, "squawk box" will be right back. yeah, we can make room. yeah. [ male announcer ] ...office space. yes, we're loving this communal seating. it's great. ..

. >> welcome back to "squawk box." we're just second literally away from jobless claims, rick santelli is standing by, rick liesman is back in the studio. rick, where are the numbers today? >> if survey says jobless claims fell 19,000 from a slightly revised 345 down to 326,000. continuing claims, running in a bit of a different calendar scaleing are running 2.95 million. is down from an upwardly revised last look at a whisker above 3 million. there is no dhut as we look at this number it is good news. there is no doubt as you look at challenger's layoff moderateing it is good news. the really great news will be if

those correlations work better. if you are not in the line to collect initial or continuing claims, you are in the line trying to cash your paycheck. maybe we'll get more information on that manana. right now, we are back above 260 on a ten-year note yield, forgeting all of the management and all of the hand winging over words like modest and how it might be a syllable different from a word last month. we see better fundamental also. yes, fundamental also. we see better pmis in china, better numbers in europe. i guess the only thing that pould make me a little apprehensive about some of these surveys in particular would be the correlations, for example, between german output and the dropbling loan issues in china. we'll have to continue to monitor that. i think today the national number will be definitely reviewed pretty closely.

back to you, guys. >> for more on the data, let's see steve. we pointed out many times when we get the claims number. this isn't in. it sort of is commentary on how things are. that's pretty good. i think if you like the stockmarket going up, you combine this tepid growth restraint with the fed. this number and a good number tomorrow. that's like goldilocks again. >> so it doesn't have the gdp numbers to pay policy. >> rick. rick. embrace it. it's good for the market. we get to keep qe. good news is not bad news. it doesn't hurt us. >> i want to point out. we haven't seen 326. >> these guys will have more reason to walk back action and make what some people think is clarity less clear. they can do whatever they want. they put the words on it to move it along, time is the only element i think they control. >> i think it's good for the

market, though. we can have the best of both worlds. is this going to be 200 tomorrow? >> that is my expectation. >> you want to foe my early call on this, i was asked, i said i think it's a 200. >> tepid growth is restraining -- >> i'm higher than. where are you? >> i'm at 235. i'll tell you why. >> not 236? >> you get more strategy, is to increase my methodology by 40% because of the part-time splitting going on. >> i will take any job i can get if terms of the quality. >> i know, i mean, yeah, absolutely. >> there is an economic reason for that. well, no, there is an economic reason. which is you don't wanttime people removed from the work force, so even a part-time job is a good step. it keeps the labor force from deteriorating. >> it was a lateral acceleration. would be the margin. >> it would be better.

i want to point out, going into this claims number, there was some commentary that we were still in the volatile period where the data was affected be i the auto shutdowns, or in this case the lack thereof. so there were some guys saying, don't read too much into this. at the same time, i will tell you we have not seen a football like 326s before the recession. this number, i'm going back here, joe, i'm looking for 326. i can find a 322 in january '08. technically that, is two weeks after a session. that was on the way up. so there is some hope in this number. we've definitely leveled out at the 350 level. the fascinating thing is seems like challenger, all of the job data is pointing towards relative strength. obviously, we want 3, 400,000. we could be doing it. 300,000 is pretty decent. yet, the economic numbers are weak. so there is this big debate

going on. are we going to revise up these gdp numbers? >> couldn't we have an unchange on the rate? >> it could go up. >> i would love to see that. that would also be -- >> you want your cake and you want to eat it, too. >> precisely. >> everybody does. >> that's not a cliche, right? you want to eat the fed's stimulus. >> yes. >> and get the earnings that would come with it. see, i think that, here's why good news is good news, if you rely on the teary, then if you are eli on the bad news is good news slot -- >> go ahead, i'm thinking. >> try to focus on this. if you rely on the bad news is good news theory, then all you are relying on is the greater fool theory that somebody is going to be out that to take you out. if good news is good news, then

i earn a stock that has earnings in it. >> it burns a hole. >> it's like being on a roller coaster, what is underneath the roller coaster? is it a shaky foundation or metal. >> is it helping the underlying economy? i'm hoping, i'm not sure, rick, i know where you think, what do you think, rick? >> you still have me going on this combination between the don't manage the real free economy. so i guess i'm wondering from a symbolic standpoint does that mean that the flag kind of morphs through a sickle and stripes, a little of each, that the way it works? >> the greatest thing earlier, steve, we talked about this was yellen was the best forecaster because she knew things were going to suck longer. fisher said she knew qe wasn't going to work. they poured it on. the entire time, they knew it wouldn't work. does that make you a good forecaster or do the same thing

over? >> i think we should realistically assess the situation of what was happening, the economy was weak and needed a lot of help. >> this isn't going to help? >> i said four times in the last couple years, we need a good forecasting. we didn't get it. >> it's gotten berts, though. >> it is the u.s. draghi is make comments, he says the labor market conditions continues to remain weak. >> i will go listen to that. i'll bring you some stuff, some red velvet cupcake economic data. >> red velvet. that's good. >> was that just invented? >> i didn't know nothing about it. how come we realize how good it is? >> we'll do a little investigative work. >> cream cheese. >> good stuff. >> when we come back, a squawk market master. he will be the joining us to

talk about jobs, the fed and much more. the million dollar car getting a lot of attention, it's if bugatti. "squawk" will be right back after this. [ music playing ] oh, hey mike. what are you up to? oh, just diagramming this accident with my state farm pocket agent app. you can also get a quote and pay your premium with this thing. i thought state farm didn't have all those apps? where did you hear that? the internet. and you believed it? yeah. they can't put anything on the internet that isn't true. where did you hear that? [ both ] the internet. oh look. here comes my date. i met him on the internet. he's a french model. uh, bonjour. [ male announcer ] state farm. more mobile than ever. get to a better state. time to have new experiences with a familiar keyboard. to update our status without opening an app.

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>> welcome back to "squawk box" this morning. shares of yellp getting a boost. j.p. morgan upgrading the stock after the company posted a smaller than expected loss after the close yesterday. tomorrow's jobs report

likely will be vital to the fed's decision about tapering. joining us right now is our squawk master mohammed el-erian, the quo cio, after the jobs numbers come out, what do you think? are we going to get a good strong number tomorrow? >> i think the economy is improving, continues to heal t. risk at markets are hearing the two things they want to hear, with i is gradual economic improvement and central banks in business as usual mode. pause they're punting on the two key issues, what to do with qe and what to do with forward guidance. for now the markets are getting support for the two things they're looking at, which encourages this notion we may get the handoff down the road from assistive growth to genuine growth. >> so that's good news, but is it going to be something that really prompts them to taper as early as september? >> so it's good news for now, right. but remember, a lot has pushed to september.

not only the fed with its tapering and forward guidance, also in europe. in europe, no one wants to disturb anything ahead of the german elections. so september will be critical. whether they taper in september or december, becky, depends on whether you think they're doing this for positive reasons because they're confident about growth or whether because they're doing it for less positive reasons because they're worried about the side effects. >> let's start with that. you think it's a given that it happens this year, though? particularly bernanke leaving in january? >> i think it's almost a given with one important qualification. they would want us to focus on the rate. they wouldment us to pay less attention to qe. more attention to the fact that they will not increase the rate for a long time. then they're going to enhance their forward guidance to support that pivot from qe to the rate. i think that's what they're trying to do here and also in the u.k.. >> okay. let walk through that very

quickly. you think they're going to be doing it. do you think there will be enough reason. is there enough economic growth to cut the taper or tapering the qe3? >> no. >> you don't? >> no. when we look at the components of growth, it's hard to get to an escape velocity. the reason they are doing it, they are starting to get more and more worried about what mr. bernanke has called the costs and risks of prolonged unconventional and spooerms experimental policy. >> then bhaps? if they do it for the wrong reason, how does the market react? >> that's the big question, right? which side will the stockmarket focus on? what the stockmarket needs right now is a handoff. we are not seeing it yet in the economic da, be you the hope that the fed has is the longer it waits, the better the data will become. is a hope as to a high probability. >> bab nar deli here.

address the seconds part about bonds. if you stay with your scenario, what are you advising your clients investors in the bond market preferred and so forth? >> it's fascinating. if you look at what's happened in the may-june debacle when the market reacted to the june 10ing taper talk, risk assets have retraced most if not all of the sell-off. not so for risk-free assets. so you have two very different views going on right now between the two markets. we say if, indeed, they're not going to change the rate, which we believe they're not going to, short and intermediate bonds look at traffic here. because they're going to try to pivot between qe and the rate. >> right. >> mohammed, are you in the equities business as well. what do you think? >> so here, we're more worried. if equity market has priced in a lot of good news. we've also priced in, we've

eliminated the let's fail from europe and china and politics. our assessment is we haven't totally eliminated -- and the amount priced in is not currently fully supported by fundamental fundamental also. >> you have been saying that for a while. >> correct. >> can you go back to, i'm not going to mention any numbers. but the fundamental also haven't been matched up with the averages for like three or four years in your view. >> no, absolutely. i think you've got central banks creating wedge, though, between fundament also and value. >> that's what you said. i love a good wedge with croutons. bleu cheese. >> eat it in your car. >> i beg to you stick with bonds. i beg you. years ago, remember that? again, i becked you.

the stockmarket beats the a totally different drummer. . >> i am excited seeing the pirates surge like this in the a.l. central. >> we have to have five of the best teams. you know, after last year with what happened with san francisco, mohammed, i feel like you, i feel like i'm a jets man fan or a mets fan. >> you are not a mets fan. >> mohammed, thank you, great talking to you. >> thank you. >> i do think he would be. >> he would. >> i know. >> newport beach, cairo. coming up, we will head down to the nys sze check in with jim cramer. among the topics we will discuss, a big miss at exxon, maybe it's not that interesting. procter & gamble. [ male announcer ] come to the golden opportunity sales event

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. >> we have a little news on edward snowden. he has received asylum in russia. he has left a transit zone. his lawyer is saying authorities granted him temporary asylum in russia. snowden's whereabouts will be kept secret for security

reasons. this will raise, of course, all sorts of questions with our relationship with russia and puented a one point said he would grant him asylum only if he would not do anything to divulge more secrets to the u.s., will do people believe him? what does it do to our relationship -- >> everything on his computer has been picked up by the chinese and the russian and both. >> how does it change -- we've speculated how it might change the relationship with the u.s. and russia and putin and not that it was great to begin with. now that it's actually been done, does it change anything? there are some meetings scheduled for this fall, does it happen? how does it work? it's a mess. in the meantime let's get down to the new york stock exchange where jim cramer joins us. i'm not sure you have views on snowden but p and g. >> it's in line with competitors with what has been mixed growth.

everyone wants to credit mr. laughly and mcdonald put the numbers in place and he was the previous ceo. and you can't turn a company as big as pg around in one quarter, so mr. mcdonald maybe he got the wrong end of the stick there in the end. >> hmm. thoughts on how everybody missed it on mobile exxon? exxonmobil? >> i'm tired of in exxon in terms of here you go you've got an oil production dekreels of 1.9% and they spend $4 billion buying back stock and they are spending a fortune to try to find oil and they are not finding it, but it doesn't matter, everyone feels no one is going to hurt buying exxon as opposed to royal dutch where everyone is hurt badly, and everything will come out in the wash final, and it's not the kind of growth that we're used to with independent companies. >> you don't tear about the downstream, you're worried about the production. >> this is another quarter. they have a 50-year plan. they've got drilling all over

the world but the problem is that you've got to get production up. >> yeah. >> bp has better numbers -- obviously bp has become a tort claim just an asbestos situation almost. but they have better growth than exxon and i expect more than that we get. this is another quarter that they didn't deliver. >> what's the mad dash on jcpenney, the stock took a hit and now it's climbing back in premarket that cit is not bailing on them. >> one of the reasons they brought in mike oleman, is he has a fantastic relationship with all these factors and the companies that extend credit, so the idea that the story came out and had any credence. mikele le ooleman is a total s guy, i was embarrassed by this story because he deserved. the antipathy toward ackman which comes through in almost every single pore these days, this is a real company that is trying to do a turn and got rid of johnson and did a good job

and brought in oleman and oleman deserved better, and this is not a good story. >> we'll leave it there and we'll see you in a few minutes. let's go to john nardelli for the last word. bob, jobs fixture tomorrow, what do you think we're going to get? >> again, becky, top priority for me is jobs and i think until as we've talked here this morning, until we can get that number down the 7.6, the 11.8 million people unemployed, employed we won't have a sustainable underpinning to sustain the numbers in the equity market as joe and you guys were talking about. >> do you think energy is a big part of that? >> i was talking to dan juergen 1.7 million jobs created already through fracking, you know, what they call the unconventional, that will go to 3 million by 2020, it's already created $63 billion in revenue for the government, it will go to $113

billion big numbers, we got to get behind energy independence. >> you look at i-pencil, you look at just making a pencil how many different jobs are created all over the place. it would be -- you could see it spread out. >> you can't wait 2,000 days to make a decision. second, i think talking with steve howe at ernst & young and the economists there now we're starting to hear about corporate tax rates going down. pardon me? >> it's not going to happen. >> we are woefully behind the rest of the world. we're disadvantaged. if washington is talking about it, they support it, they believe in it, let's not tie it to a quid pro quo we'll reduce tax rates but you got to spend more. let's get tax rates down and get corporations going, they're going to create the jobs, becky. >> bob, thanks so much for joining us today. >> it's been great. >> it's always a pleasure. we can't leave the bugatti leave the parking lot without

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whoo! that is some serious power! >> jay leno said it right when he said it's not acceleration, it's teleportation. >> that's right. >> what's that? >> well, that was robert driving earlier. how fast did you go? >> you know, the speedometer goes to 280 and it didn't look like i went there. >> you were basically on empty? >> yeah, basically. but, what's cool about it, so, there's a second silver key if you want to go over maybe 200 something. >> what do you mean a second silver key? >> there's the regular key here and the super secret silver key. >> but does it lock you out? >> no, you put it in and it allows you to go super extra fast up to 200 miles an hour. >> the camera doesn't show that finish, does it? you can't really see. this is the carbon.

>> it picked up my fingerprint. >> it's amazing, this is a karen something. >> carbon fiber. magnesium. >> is that a tiptronic-type thing? >> it's all paddle. downshift is on the right, and upshift is on the right. >> do you -- >> no, i left it. >> do you know how many gears? >> seven. >> can you pop the trunk? do you know how to do that? >> i have no idea. >> it's in the front, right? >> it's in the front. >> it basically holds the little umbrella thing that goes here and maybe a wallet. >> definitely no golf clubs. you could put golf clubs there if you didn't have a passenger possibly. >> you said it didn't have a clutch. it's not an automatic. >> you can do both. you can do either. >> it's a tiptronic. it's complicated. there's no clutch, you'd be fine. >> tiptronic, you'd be fine. >> you're going to leave? >> that's a good idea. given the opportunity. >> bye. oh, he's a brave man. and he's driving with one hand,

oh, my gosh. folks, that does it for us today. have a great weekend, everybody, right now it's time for "squawk on the street." nice car. good thursday morning. welcome to "squawk on the street." i'm carl quintanilla with jim cramer and david faber at the new york stock exchange. we kick off a new month with bullish action. futures up nicely. the nasdaq in particular now up 20% for the year. earnings are in from p & g and exxon, and the jobless claims a very big win, just 326. that's the best figure in more than five years. ecb and bank of england did hold steady and the euro zone pmis not bad 8 of 11 countries saw gains in july. the roadmap begins with the good feelings in the market on the back of the upbeat and jobs ta